ALASKA HIGHWAY NEWS
THURSDAY, APRIL 28, 2022 | OP-ED | A11
Is inflation really that bad?
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he dangers of inflation have been in the news a lot lately. But then, a lot of things get portrayed as dangerous. So, is inflation really all that bad? A complete answer to the dangers of inflation will include that, in the short term, inflation is not usually the biggest financial risk you may be facing. If you are wondering how much the price of gas will be this summer, even if it is a little more than you are paying now, it is not likely to change the overall quality of your life. But let’s be clear: When it comes to inflation, we are usually not simply just talking about how much it is going to cost to fill your gas tank this summer. We are talking about relentless, often permanent, increases in the cost of virtually everything that you spend money on, for the rest of your lifetime. Inflation makes it harder and harder to make ends meet, especially for anyone on a fixed income, and it is not an easy problem to solve. So, yes, inflation really is that bad. The concept of inflation can sometimes come across as a little dry and academic, so here’s a reallife example. I graduated from high school way back in 1985. As is the custom, there were some grad announcements in the local newspaper, which were saved for posterity. I stumbled upon this bit of nostalgia just a few years ago, and it made for some interesting reading. Of course, I checked out the news of my old high school friends, but the financial planner side of me found something else. An advertisement for groceries, that included the 1985 prices for regular, everyday items like dog
BRAD BRAIN food, and paper towel, and orange juice. There were 10 different products featured, and if you bought one of each it would have cost you $25.80 in 1985. So, what does this same basket of goods – the types of things that you would buy for everyday living – cost 35 years later? The answer is $77.28. Think about that. You need 300% more money to buy the same things. That, my friends, is inflation. The good news is that there is a simple answer to beating the cost of living. You just need your money to grow faster than inflation. Unfortunately, just because the answer is simple doesn’t make it easy. Cryptocurrency has been suggested as an answer to inflation, but let’s face facts: Any claims that cryptocurrency provides reliable inflation protection are evidence-free. Here’s an example. One popular crypto is Dogecoin, which went from one cent to an all-time high of 73 cents in just four months. The only thing is, it is currently trading at 13.5 cents. This isn’t inflation protection, it’s a casino. The reality is that cryptocurrencies did not even exist before 2009, so it’s easy to be skeptical. What about some more traditional options for inflation protection, such as gold? The current one-year return for gold is about 11%, and that seems to give some people hope as offering inflation protection. But gold as an antidote to inflation is
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based more on sentiment than on facts. The current 10-year return for gold is about 13%. That’s not 13% per year, it’s 13% total. To make 13% over a decade is not impressive at all. And this has not only been a problem over the last 10 years. Certainly, gold has its spurts, but if you look at the long-term performance for gold it is one of the poorest performers on record, going back 200 years. To sum up, inflation really is something that you should worry about, and some of the popular suggestions for coping with inflation just don’t stand up to scrutiny. Next week I will tell you what does work for inflation protection. Brad Brain, CFP, R.F.P., CIM, TEP is a Certified Financial Planner in Fort St John, BC. This material is prepared for general circulation and may not reflect your individual financial circumstances. Brad can be reached at www.bradbrainfinancial.com. ALL THE RIGHT NOTES — Members of the Alleluia Children’s Choir get a lesson from visiting adjudicator Norene Morrow during the Peace River North Festival of the Arts at the North Peace Cultural Centre, April 24, 2022. MATT PREPROST PHOTO
Desperation and our darkest hours
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f we truly understood those words of Jesus spoken while He was on the cross, then we would understand that nothing can separate us from the love of God. When we feel hopelessly separated from God, we must realize that in spite of how we feel He is there with us. When we feel like it is the darkest moment in our live and we believe that God does not exist or, has left us or has abandoned us, or He is not real, we need to know that He truly is with us even in those darkest moments or darkest times in our lives. Let’s go back to the cross, when Jesus was on the cross and spoke those words, “My God why have You forsaken Me?” As He was on the cross, He became sin as He was taking our sin and as part of judgment He was separated from God. The key is who was saying those words but God and who is asking God but Immanuel. That is who is speaking those words in our place and it appears to be a paradox. In other words, God became God forsaken. God is speaking those words because He is in our place and as a result, He is the One asking why God is not with Him as “God” is with us. What separates the Christian faith from all others is mankind’s sin and that sin before a Holy God needed a Savior and that Savior was and is Jesus Christ. He became the New Covenant for all who believe, repent and desire to follow Him. So often in
JOHN GRADY our lives when everything appears a disaster, everything that could go wrong does, when we feel we are on that Island by ourselves, desolate, forgotten, abandoned He is there with us. It was God Himself saying those words in our place that despite our surroundings or how we feel God has forsaken us He Chose to be forsaken with us and the truth of Him on the cross and the resurrection is we will never be forsaken. God is Holy, He is love, He is faithful, He is trustworthy, and He desires us in His kingdom for eternity. One of the greatest promises He made is I will never leave you nor forsake you and the proof of that is Him giving His life for us. It is those times in our life when we feel the furthest from our Lord that He truly is with us and will never leave us. The reason this is so important is not just for theology but a reality of God’s faithfulness at all times, in all circumstances in our lives including our desperation and darkest hour. John Grady lives and writes in Fort St John.
ALASKA HIGHWAY NEWS
A12 | PIPELINE NEWS NORTH | THURSDAY, APRIL 28, 2022
Major projects lift Northeast B.C. through pandemic recovery Matt Preprost editor@ahnfsj.ca Continued construction of the Site C dam and the Coastal GasLink pipeline are expected carry Northeast B.C. through its economic recovery from the COVID-19 pandemic, according to the latest economic outlook from the Northern Development Initiative Trust. The NDIT released its 2021 State of the North economic report on Wednesday, April 6, saying mining, natural gas exploration and production, as well as improved commodity prices are also expected to help support employment in the region. “This year’s State of the North contains good news, bad news and a lot of uncertainty,” NDIT CEO Joel McKay says in a release. “Our region is faced with labour shortages, slow population growth and a myriad of other risks from floods, fires and a war in Eastern Europe. However, major project constructions along with strong commodity prices will likely continue to support various industry sectors for the next few years.” The northeast has already been buoyed by major projects during the pandemic, with the NDIT noting regional unemployment recovered “particularly quickly” from the first wave of lockdowns due to strong employment growth. Unemployment was at 6.3% in 2019 leading into the pandemic, peaked at 11.1% in May 2020, and had dropped to 4.6% by the end of 2021. “The construction, forestry and mining sectors experienced strong gains in 2021, which was likely linked to re-hiring at the Site C dam as well as an increase in drilling activity due to improvements in the price of natural gas,” the report says. But the return to work hasn’t come without its challenges, with the NDIT reporting the working age population in the region stayed relatively stable while the labour force declined between 2019 and 2021.
This may delay the return of out-of-province visitors and encourage more B.C. residents to vacation within the province in 2022. For Northern B.C., this may lead to higher levels of visitation at key attractions.” And though more people in the region are working today in accomodation and food services than in 2019, the NDIT says “tourism operators are facing staffing difficulties amid a reshaping of the labour market, that could limit capacity in the sector in the near-term.” Here are some other regional highlights from the report:
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Following the installation of girders, the Farrell Creek Bridge realignment crosses Highway 29 for the first time.
“This suggests that some people in these regions have chosen not to seek employment, which may reflect concerns about workplace safety, exposure to the COVID-19 virus, or not being able to meet vaccine requirements for potential employers,” the report says. Looking ahead, the NDIT is signalling positive growth for natural gas production. It says market prices are expected to remain strong, driven by Chinese demand, while wells drilled for LNG export are expected to continue to increase as the LNG Canada facility, now more than 50% built, marches toward completion. “Extreme weather events and the inconsistent nature of renewable energy is expected to support demand for reliable backup energy sources, like natural gas, in the short to medium term,” the report says. In forestry, harvest volumes were up in 2021 but mills in the region have been stymied by transportation shortages this year, particularly at Taylor pulp, which has been curtailed since mid-February. Meantime, the schedule at the Fort St. John sawmill has been reduced to four days a week,
and the NDIT adds the impact of old growth logging deferrals in the north is “uncertain at this time.” “Lumber prices are expected to remain at or above current levels, while a return to the peak prices seen in early 2021 is unlikely,” the report says. “However, there remains considerable uncertainty in the pulp sector as the lack of fibre supply has led to mill closures. Additionally, ongoing supply chain issues were made worse by the significant wildfires in 2021 which disrupted transportation and led to logging curtailments.” Other sectors face extreme challenges but others still opportunities. For agriculture, the NDIT notes northeast farmers— who produce 80% of B.C.’s grain and oilseed crops— faced a challenging 2020 with poor yields driven by extreme summer drought. As they recover, farmers are also bracing for increased input costs this season, from fuel to taxes to fertilizers, and the Peace River Regional District is lobbying the provincial government for relief. “Producer deliveries of wheat declined by 21 per cent compared to 2019 due
to poor weather conditions,” the report says. “Data from 2021 indicates another difficult year as wheat deliveries were down 31 per cent between January and October, compared with the same period in 2020.” In mining, the NDIT says prices for metallurgical coal increased in 2021 as Chinese steel production recovered to pre-pandemic levels. “Looking forward, B.C.’s mining sector is expected to continue to be supported by favourable commodity prices leading to increased exploration and improved economic activity,” the report says. And as for tourism, the NDIT says the reopening of borders to non-essential travel is expected to lead to a significant increase in visits, particularly from British Columbians — welcome news after “a particularly bad wildfire season” limited travel to the north last summer. “Travel restrictions during the winter months also restricted recreation-based travel to the Northeast region for skiing and snowmobiling,” the report says. “Looking forward, rising oil prices will increase the cost of all modes of travel.
• There are 366 businesses in mining, oil and gas in Northeast B.C.; • There are 1,359 farms in Northeast B.C.: 844 crops; 515 livestock; • Northeast B.C. experienced an overall decline in population of 3.4% between 2016 and 2021; • Between 2020 and 2040, the population in Northeast B.C. is projected to grow at an annual rate of 0.8%, while the number of households are projected to grow at an annual rate of 1.1%; • The population in Northeast B.C. is projected to age, with the percentage of the population aged 65 and over rising from 11% in 2020 to 17% by 2040, while the population under age 19 is projected to decline by a similar amount; • Median wages in Northeast B.C. are comparable to other parts of Northern B.C. In the goods sector, most industries’ median wages exceed the living wage of $18.29, though occupations in retail and food services are below the living wage; • Housing prices broadly decreased in the Northeast region in 2021, aside from Fort St. John. The region’s economic centre, Fort St. John experienced doubledigit year-over-year gains for the second straight year; • The number of dwellings in the Dawson Creek area increased by over 40% while population declined resulting in a sharp drop in housing prices.
Woodfibre LNG construction set to begin in 2023 Nelson Bennett nbennett@biv.com After years of delays, the $1.6 billion Woodfibre LNG project in Squamish is finally officially a go. Woodfibre LNG announced April 14 it has issued a notice to proceed to its main contractor McDermott, with major construction to begin in 2023. Last month, Pacific Energy Corp. approved more than $600 million (US$500 million) in spending for the project in 2022 for pre-construction. Now, the main contractor has the green light to ready the project for full construction to start in 2023. Woodfibre officially set up its office in Squamish in 2013. Several setbacks have pushed back a final investment decision and construction start date, requiring Woodfibre LNG to get extensions to its environmental certificate. Woodfibre LNG will be the second LNG plant built in B.C., after the much larger LNG Canada project in Kitimat.
MCDERMOTT INTERNATIONAL
Woodfibre LNG schematic design.
Once construction work begins in earnest, the project is expected to employ a peak workforce of 650 people. In addition to work on the actual LNG plant in Squamish, FortisBC, which will supply the plant with natural gas, needs to build a new connector pipeline. The 47-kilometre Eagle Mountain-Woodfibre Gas
Pipeline will run from Coquitlam to Squamish. FortisBC expects construction to start on that project in 2023. Compared to the $18 billion LNG Canada project in Kitimat, the Woodfibre LNG project is small, with an annual export capacity of 2.1 million metric tonnes, compared to LNG Canada’s 13 million tonnes.
The plant will be among the first LNG plants to use electric drive, which lowers its carbon emissions intensity to an estimated 0.054 tonnes of CO2 equivalent per tonne of LNG (tCO2e/t). The global average emissions intensity of LNG plants, most of which use natural gas instead of electricity to drive the chilling process, is 0.26 to 0.35
tCO2e/t. The project has the support of the Squamish First Nation, which has an impacts benefits agreement with Woodfibre LNG, the provincial government and FortisBC that includes $225.7 million in cash and nine parcels of land totaling 422 hectares.